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October 2011

Sydney’s fast lanes

Australia [URBAN DEVELOPMENT]

Melbourne is well known for its bustling laneways, which went through major rejuvenation in the early 1990s. Loath to let its near-neighbours have too much of a good thing, Sydney has been playing catch up since 2008 with its own Laneways Business Development Programme.

The progress has been impressive thus far: AU$158,000 (€114,000) of funding has been granted to six small businesses, with a further five applications currently under consideration; in total, more than 20 new small businesses have opened up in these under-used spaces in the inner city. In their wake, a plethora of colourful drinking dens have set up shop. Relaxed licensing laws brought in by Mayor Clover Moore – also in 2008 – have made it far easier for boutique bars to open up, with nearly 40 of them gaining approval so far.

“Sydney’s small bars have created about 60 full-time and 200 part-time jobs, and are putting AU$50m [€36m] into the local economy,” says Richard Roberts, the City of Sydney’s business development coordinator.

Three burgeoning bars:

Shady Pines, Surry Hills: Knowledgeable bartenders, live country music and fine bourbon.

Shirt Bar, CBD: Shirt shop, bar and café.

Cre Asion, Surry Hills: This tiny Japanese tea house specialises in macarons.

Buy into a theme

USA [INVESTMENT]

A new Silicon Valley firm is offering a more inventive way to invest. Motif creates baskets of stocks based on ideas chosen by customers, such as “cloud computing”, “clean technology” and even “Middle East democracy”. For example, if a customer wants to invest in “rising interest rates”, they can select the theme and Motif will suggest investments that reflect this, such as companies with large cash reserves that would be unaffected by an increase in borrowing costs.

It might sound like a gimmick, but the proof is in the venture capital investment it has attracted: $26m (€18m). “The challenge for most people is that they have no way to map their idea to an actionable investment,” says Tariq Hilaly, a co-founder and a former hedge fund analyst. Headed by a former Microsoft executive, Hardeep Walia, Motif is currently accepting beta users and is expected to launch later this year.

Money from the Mob

Italy [MAFIA]

Two of the latest additions to Libera Terra, an Italian cooperative that develops land reclaimed from the Mafia, include Portella della Ginestra and Terre di Corleone: B&Bs that combine idyllic settings with a colourful past. Both houses once belonged to Mafiosi. Today, Libera Terra has eight co-ops in four regions across southern Italy (Puglia, Sicilia, Calabria and Campania), manages 1,000 hectares, and has a staff of 130. The company sells more than 30 organic products, from Sicilian lemon compote to dried chickpeas, and manages two winemaking entities.

Revenue in 2010 was €7m, and the group expects continued growth. The operations of Libera Terra are made possible by a law passed in 1996 that allows private organisations, cooperatives or municipalities access to property acquired through illegal activities. The stipulation is that the land be returned to the community by making it socially beneficial.

Greener favelas

Brazil [RECYCLING]

When it comes to recycling, Brazil is among the world’s leaders. Most of this is down to enterprising individuals rather than organised schemes. There are signs that might be changing with a new programme run by the Rio de Janeiro electricity firm Light.

Starting in one of the city’s recently pacified favelas, Light is allowing residents to swap reusable materials for money off their electricity bills. The programme is based on one in Fortaleza, where the 300,000 participants can choose to donate their credits to a local charity.

Energy company Texaco and steel-maker Gerdau are already scheme partners in Fortaleza, while 3G Engineering is the main sponsor in Rio. “This project encourages recycling within the company’s concession area and at the same time contributes to sustainable development and the consumer’s pocket,” says Fernanda Mayrink, Light’s community outreach officer.

Fresh green initiatives:

Vietnam: NGO Anh Duong teaches children in 56 schools to collect plastic waste to then be sold for recycling. Awards are given to participating schools in the form of school improvements and scholarships.

USA: Atlanta-based Global Soap Project cleans up used soap from US hotels and sends them on to poorer nations such as Haiti to help prevent the spread of disease.

Hacked off

UK

Cybercrime has blighted big business in recent years, with the appearance of “hacktivist” groups such as Anonymous and LulzSec. Scotland Yard has quadrupled the size of its cybercrime unit to 85 officers after receiving a £30m (€34m) boost to its budget in 2011.

Protecting interests

Global

Oil companies are increasingly turning to private security contractors to protect their resources. Shell currently employs over 1,200 private police in Nigeria, ExxonMobil over 700 and Chevron approximately 250. Shell also uses over 600 armed police and paramilitary officers.

Brew pastures

Japan [SAKE]

The Japanese have been turning their backs on sake for decades, but overseas the prospects for the national drink seem brighter. The idea of brewing sake for a global audience led Takeshi Akiyama (pictured) to quit his job at a New York design firm and return home to revive Ohmine Shuzou, a three-centuries-old brewery his grandfather ran in Oita prefecture.

Ohmine hadn’t made sake since the 1950s, and most of the equipment wasn’t salvageable. Rather than invest in new tanks, Akiyama rented facilities at a nearby brewery and set about formulating new recipes. To attract drinkers who find sake too potent, he lowered the alcohol content to 14 per cent and gave it a smoother taste. Having observed New Yorkers at Japanese restaurants, Akiyama knew that sake labels were confusing so he worked with Stockholm Design Lab to demystify Ohmine’s offerings. They decided on a white bottle with rice-kernel silhouettes designating Ohmine’s three brews – one kernel for the premium Junmai Daiginjo, two for Junmai Ginjo, three for standard Junmai. Ohmine’s first 5,000-litre batch quickly sold out in early 2010. “Half of our sales come from six overseas markets,” says 31-year-old Akiyama. “We plan on boosting output soon.”

Canadians fly south

USA [AIRPORTS]

US airports near the border with Canada are cashing in as Canadians flock south for cheaper flights. One in five Canadian leisure travellers drove to a US airport last year, such as Bellingham in Washington, which is siphoning off passengers who might otherwise use Vancouver. Around half the passengers at the airport are Canadian, and thanks to the influx it is in the midst of a $30m (€21m) expansion. Plattsburgh Airport in New York state even markets itself as “Montréal’s US airport”, complete with a French website.

Growing permaculture

Global [CONSTRUCTION]

Toilets and window sashes hardly seem the stuff of global empires but Japan’s JS Group aims to build a formidable business from these humble beginnings. The Tokyo fittings company hopes to boost overseas revenues 25-fold to more than €9bn by 2016, and spent more than €570m to buy Italy’s Permasteelisa this year. Known for building stunning glass-and-steel facades such as that at Dubai’s new Terminal 3, the Italian firm’s expertise and overseas network seriously boosts JS Group’s influence beyond East Asia.

Virtual shopping

China [SUPERMARKETS]

In Shanghai, grocery stores face an uncertain future, now that Yihaodian, the country’s leading online grocery vendor, has introduced virtual supermarkets in nearly a dozen subway stations. After downloading the Yihaodian app, shoppers use their phones to scan barcodes of the items posted on LED screens in the stations and products are delivered to their homes within hours.

The technology was pioneered earlier this year by Tesco Homeplus in South Korea, where it has become so popular Tesco is now the country’s No. 1 online grocery store. Yihaodian is hoping to build on its already huge success: the company’s sales are increasing by 28 per cent each month and are expected to hit €325m this year, nearly quadrupling those of 2010.

Higher revenue, though, is not the company’s only goal, says Lily Yu, director of the wireless application department. “Changing people’s lifestyles is what we are striving for.”

Tasty air fare

Sweden [AIRLINES]

Airplane meals are usually the stuff of nightmares but Kullaflyg, a small Swedish airline, has turned the concept around. Its policy of serving locally produced food on flights has taken off, leading to happier customers and, just as importantly, profits. Based in the southern Swedish airport of Ängelholm, Kullaflyg was founded eight years ago by local businessmen to support the region’s development.

“There are so many great products and farmers around here,” says CEO Christer Paulsson. “We are a regional airline, and we also want to live up to that image with our meals.” All producers are located less than an hour from the airport, where the company has built its own catering facilities. The food is prepared by Graffagården, a local caterer, and passengers enjoy delicacies such as fresh berries and cakes from a local bakery. Paulsson wants other airlines to follow suit. “If I fly from Spain, I’d like to eat something Spanish.”